In the midst of an ongoing campaign to boost its profile in the increasingly crowded animal health space, Parnell Pharmaceutical Holdings ($PARN) named two new top executives and one board member to its growing team on Tuesday evening. The Kansas company appointed veterinarian Edward Robb as chief scientific officer and Andy Ferrigno as vice president of global sales. Thomas Duley of life science consultancy King & Spalding was named to the company's board of directors.
The announcements did little, however, to boost Parnell's stock, which had fallen since the company's June IPO from $10 a share to $3.85. The day after the personnel changes were announced, the stock dropped nearly 2% to $3.74.
Parnell CEO Robert Joseph has been doing everything he can to bring more attention to the company's growth prospects, making presentations at the Jefferies 2014 Global Healthcare Conference in London in late November and at the Piper Jaffray Healthcare Conference a couple of weeks later in New York. And the company's top executives will be heading off to San Francisco in mid-January to present at Biotech Showcase, being held in conjunction with the high-profile JP Morgan Healthcare Conference.
During his recent visit to New York, Joseph sat down with FierceAnimalHealth to talk about Parnell's plans and reflect on its first 6 months as a public company. "We've got a blue-chip share register," with Blackrock, Fidelity, and others among the top shareholders, Joseph said. "Our top 10 shareholders have significantly increased their holdings post-IPO."
Problem is, those top 10 stakeholders and a small group of founders and employees own 95% of the shares, making it a thinly traded stock, Joseph said. To make matters worse, Parnell debuted on Wall Street right before a high-profile animal health failure: the failure of Kindred Bioscience's ($KIN) canine osteoarthritis drug and subsequent free fall of that company's stock. "Frankly I think we caught a bit of the downdraft," Joseph said.
Still, Joseph remains upbeat about Parnell's future. The company, which was founded in Australia, has 5 products on the market overseas, including its own osteoarthritis drug, Zydax. It has begun a pivotal study of Zydax in dogs that's required for FDA approval and hopes to have the product on the market in both the U.S. and Europe in 2016.
"We've been selling this drug for 7 years and it's been very successful," Joseph says. "We do just under $2 million in revenue in Australia for the osteoarthritis franchise. The market size in Europe and the U.S. is 80 times bigger than that."
Parnell already has some presence in the U.S. market with its fertility products for cattle, GONAbreed and estroPLAN. The company currently has about a 5% market share, but Joseph is optimistic it can expand its presence in the market via services such as mySYNCH, a digital technology that allows dairy farmers to efficiently record, manage, and analyze all of their reproductive programs.
Joseph says offering mySYNCH as a service gives Parnell "a differentiated value proposition. The broader benchmarking capability--the ability for farmers to know how their farms compare to others--gives them an economic advantage. We see that as an opportunity to grow a significant subscription business."
Parnell has 7 drugs in its pipeline, including a diabetes product for dogs and horses, an anesthesia drug for dogs and cats, and a dermatology treatment for dogs. The pipeline strategy will be guided by new chief scientific officer Robb, who joins Parnell from Boehringer Ingelheim's Vetmedica. Robb also held senior management positions at Pfizer ($PFE) Animal Health and Pharmacia and Upjohn Animal Health, according to Parnell's release. He replaces former CSO Robert Hunter.
As Joseph continues to make the rounds of investor conferences, he says he's gathering a reassuring amount of positive feedback on Parnell's strategy. "We've spent a lot of time on the road. Our investors have shared their sentiment that they think we have a great business model and they're confident in our future," he said.
- here's the press release on the personnel appointments